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TINSA market report October 2018

The valuations compiled by TINSA have been suggesting a good return on investment for property investors. With property prices predicted to increase siggificantly in most areas.

Where are prices rising the most ?

According to Tinsa, property prices in Spain are rising fastest in the big cities (Madrid, Barcelona, Valencia…) at a whooping 8.3% interannually and along the Mediterranean coast.

Capitals and big cities: 8.3%
Metropolitan Areas: 3.8%
Mediterranean Coast: 6%
Balearics and Canarys: 4.5%
Other Municipalities: 0.9%

Rising the least, smaller towns in inland areas.

Prices are still 37% off peak prices

TInsa Report October 2018 (Spanish)

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Buying Properties

Supreme Court rules that Banks, not Clients must pay Mortgage Tax

On the 16th of October the Spanish supreme court ruled that banks rather than property purchasers should pay the AJD (Actos Jurídicos Documentados), tax on mortgages. This overturns the Supreme Court’s own ruling from February.

The court reasoned by 15 – 13 that it is the banks, not the buyer that benefit from the mortgage being notarised.

The effect of this decision was seen in a fall in share prices of some of the major Spanish banks includin: Bankia, Bankinter, BBVA, CaixaBank and Sabadell.

The banks in Spain have been hit by a number of legal decisions that have effected the profitablity of mortages, including the “Clausula Suelo” (Mortgage rate floor clauses).

The likely effect will be that as mortgage loans become less profitable for the banks, borrowers can expect higher fees, rates and increased costs to offset the expense to the banks.

Purchasers affected by this ruling will be able to claim, but it’s as yet to unclear how far back claims can be made retrospectively. Legal analysts have stated that they expect the period covered by the ruling will be at least 4 years.

Mortgage set-up costs in Spain are high compared to other countries and it may be worth looking at alternative financing options.

 

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Reciprocal Residency Rights

It is in the mutual interest of the UK and Spain to establish

 

 

http://www.telegraph.co.uk/news/2016/11/22/british-expats-set-granted-right-carry-living-eu-theresa-mays/

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Negotiating the price

Negotiating the price of a property may be a daunting prospect for the prospective buyer, but taking on board a few tips should make you better prepared and could save you a considerable sum.

Many vendors build in a margin for negotiation when putting their spanish property on sale, since they expect to have to accept an offer below the asking price.

It’s

The agent may know what the vendor will accept, perhaps based on previous

It’s quite typical for example

A 5% discount on the asking price is quite common. The amount that can be negotiated depends on many factors.

  • Needs of the seller. Do they need a quick sale ?
  • Competition in the market place. How much are similar properties going for ?

Let’s say a property is listed for sale at 100,000€.  It would be quite typical for a first offer to be around 90,000€. The vendor and buyer might settle on a final price of 95,000€

How much commission does the agent have on the property ? You may

It’s not just the price offered which determines the strength of an offer.

  • Is the buyer willing to pay a deposit straight away?
  • Is the buyer ready to proceed?
  • Does the buyer need a mortgage ?
  • Has the buyer already instructed a lawyer and have their NIE number.

It is rare in the current market for a property to make the full asking price.

Are their other interested parties ?

It does happen that prospective purchasers are told that their is another interested party and that if they don’t move quickly they will lose the property. The prospective purchasers

Are their other offers on the table?

If the agent tells you that they already

Take your time. If you rush to increase on your initial offer then

The agent might state that the vendor previously decline an offer equal to or inexcess of your offer.

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Buying Properties Location Price Real Estate

How to present a property

Presenting a property correctly can vastly improve your chances of achieveing a sale

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Buying Properties

Purchase costs

It’s important to budget for the associated costs of purchase

 

IVA or ITP tax

if you are buying a new property you will pay IVA (VAT) tax to the c

If you are buying a second hand property  there is a tax payable to the aut. The tax rate varies depending on where the property is and in some autonomous communities the price band.

 

Legal fees / Conveyancing

It’s strongly advisable to employee the services of

Notary Costs

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